Kudankulam deal unlikely at India-Russia meet

Prime Minister Manmohan Singh touched down to chilly winds in the Russian capital on the first leg of his two-nation tour to deepen New Delhi’s strategic partnership with Moscow, before moving to China with who India had “historical issues” and “areas of concerns”.

But a key commercial pact to set up the third and fourth unit of Tamil Nadu’s Kudankulam nuclear power project would not be ready in time, stuck due to Russian apprehensions over the debilitating impact that India’s unlimited liability law would have on them.

Russia had worked with the Nuclear Power Corporation of India to set up the first two 1000mw plants that are expected to begin producing power soon.

As he gets down to business in Moscow on Monday, the two sides will sign five agreements in Singh’s presence at the Indo-Russian Annual Summit, an annual event since 2000 to strengthen the strategic partnership between the two sides.

The two sides are also taking baby steps to look at the possibility of setting up a gas pipeline from Russia to India, a rather ambitious project prompted by Russian fears of losing its markets in Europe to competitively-priced Shale gas.

But Indian officials indicated more important than the agreements – ranging from a pact on transferring sentenced prisoners to cooperation in energy efficiency – were the one-to-one discussions between Russian President Vladimir Putin and Singh on defence acquisitions, trade, energy as well as their similar positions on Syria and Afghanistan.

Some of this bonhomie would clearly be missing when Manmohan Singh moves on to Beijing on Wednesday.

The two countries are expected to sign the Border Defence Cooperation Agreement that would help reduce instances of the stand-off between defence forces from the two sides such as the one witnessed earlier this year when a PLA patrol party pitched a tent 19 km into Indian territory and stayed put for nearly three weeks.

“India and China have historical issues and there are areas of concern,” Singh said before embarking from India. “The two governments are addressing them with sincerity and maturity, without letting them affect the overall atmosphere of friendship and cooperation,” he said.

In negotiations on raising trade, Singh also faces the challenge to persuade the Chinese leadership to take proactive measures to reduce the burgeoning trade deficit that could touch $40 billion this year.

During his visit to India earlier this year, Premier Li Keqiang had evinced interest in setting up industrial parks in India that the foreign secretary hopes would help address the trade deficit. Not everyone, however, is as convinced.

Prof Srikanth Kondapalli at Jawaharlal Nehru University believes China appeared reluctant to take the necessary steps to address the deficit. A handful of industrial parks will really not make much of a difference to the trade deficit, Prof. Kondapalli said.